Industry Updates

BlackRock changes benchmarks on SRI equity ETF range

Tom Eckett

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BlackRock has changed the benchmarks on its socially responsible investing (SRI) equity ETF range to include a further reduction in fossil fuels,

ETF Stream

can reveal.

The six-strong ETF range, which offers exposure to global, European, US, emerging markets and Japan, will now track versions of the MSCI SRI Select Reduced Fossil Fuel index.

The new indices have an increased number of environmental screens and a 5% issuer cap on holdings.

The indices have an exclusion screen on companies in the certain industries such as controversial weapons, civilian firearms, nuclear weapons, tobacco, alcohol, adult entertainment, conventional weapons, gambling genetically modified organisms and nuclear power.

They also have environmental screens for companies involved in thermal coal, oil sands and oil and gas.

BlackRock said in a statement: “We are constantly evaluating the ESG credentials underpinning our sustainable ETF ranges, to ensure they deliver the best possible outcomes for investors looking to build ESG criteria into their portfolios.

“These changes aim to strengthen the products’ environmental credentials and reduce high concentration in single stock names.”

BlackRock’s proxy voting history and ETF push highlight conflicting attitudes to ESG

The SRI equity ETFs previously tracked versions of the MSCI SRI index suite.

BlackRock’s sustainable ETF range is split into five categories; ESG screened, ESG enhanced, thematic, impact and SRI.

Earlier this year, the world's largest asset manager launched Europe's first high yield ETF with an ESG tilt, the iShares USD High Yield Corp Bond ESG UCITS ETF (DHYE).

ETF NameOld BenchmarkNew BenchmarkiShares MSCI Europe SRI UCITS ETF EURMSCI Europe SRI IndexMSCI Europe SRI Select Reduced Fossil Fuel IndexiShares MSCI EM SRI UCITS ETF USDMSCI EM SRI IndexMSCI EM SRI Select Reduced Fossil Fuel IndexiShares MSCI World SRI UCITS ETF EURMSCI World SRI IndexMSCI WORLD SRI Select Reduced Fossil Fuel IndexiShares MSCI USA SRI UCITS ETF USDMSCI USA SRI IndexMSCI USA SRI Select Reduced Fossil Fuel IndexiShares MSCI USA SRI UCITS ETF EUR HedgediShares MSCI Japan SRI UCITS ETFMSCI Japan SRI IndexMSCI Japan SRI Select Reduced Fossil Fuel Index

Source: BlackRock

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